If you are entering the real estate world, especially for the first time, the numerous terms thrown around can be extremely overwhelming. Escrow, appraisal, property title, deeds, and so many more! These terms may cause a lot of unnecessary headaches, but they are an essential part of the homeownership process. For example, what’s the difference between the property title vs deed? While a lot of people may use these terms interchangeably, they are separate legal concepts. Read on to learn more about the differences between the two.
Find out What Escrow is in Real Estate
What is a Property Title?
A title is the legal ownership of a property and the rights set over the property. Titles are not exclusive to real estate—many other items of value have titles, such as boats and cars. The legal purchase of a house transfers the title to the buyer from the previous owner(s), along with the deed. In simpler terms, a title is a legal way of saying you have ownership. Titles are then transferred by deeds.
When you possess the title to a property, you have the following rights:
- The right of possession. As the legal owner, you have the right to be on the property.
- The right of control. As the legal owner, you have the right to do whatever you want on the property, as long as it is not illegal.
- The right of exclusion. As the legal owner, you have the right to dictate who can and cannot be on the property.
- The right of enjoyment. As the legal owner, you have the right to not be bothered by others and live peacefully on the property.
- The right of disposition. As the legal owner, you have the right to transfer ownership.
What is a Deed?
A deed is evidence of a distinct event of transferring the title of the property from one person to another. This represents the right of the owner to claim the property. A deed must be a physical document signed by both seller and buyer of the property. According to Maryland law, all deeds are required to include the names of the seller and buyer, description of the property, and the interest you intend to convey. The new owner must physically possess a deed following the property’s purchase.
Different Types of Deeds:
- General Warranty Deed
- Special Warranty Deed (the most commonly used deed in Maryland)
- Quitclaim Deed
To learn more about other potential deed options, contact a real estate attorney or the Land Records Department.
Property Title vs Deed: Knowing the Difference
The biggest difference between a property title and deed is the physical component. While a deed is an official written document proclaiming a person’s legal ownership, a title refers to the concept of ownership rights. For more clarity, think of a book: the deed is the physical cover and pages; meanwhile, a property title would be akin to the book’s title.
Understanding the difference between titles and deeds and their respective purposes is a crucial part of the homeownership process. Just remember property titles are concepts of ownership, deeds are physical documentation of ownership!
We hope that this blog was informative and helped in your homebuying process. For more information regarding property titles, deeds, and the homeownership process, contact Express Title today.